Bulletin: WA000017

Date:
August 08, 1990
To:
All Washington Offices
RE:
Lien Foreclosures

Dear Associates:

The Washington Court of Appeals has ruled that a foreclosure of a mechanic's lien is invalid unless all lienholders of record are joined in the foreclosure. Queen Anne Parking v. Olney & Associates, 788 P.2d 580 (Wash. App. 1990).

In this case a suit for foreclosure of a mechanic's lien was filed. The plaintiff failed to serve a lien claimant and deed of trust beneficiary within 90 days of filing. Both the lien claimant and beneficiary had priority over the plaintiff's claim of lien and would not have been affected by the suit.

Nevertheless the court of appeals threw out the foreclosure for failure to comply with the lien statutes. The eight month foreclosure period had now expired and another suit was not possible.

This means that if you miss any recorded interests in a litigation guarantee for a lien foreclosure, the foreclosure will be invalid. It will not be possible to correct the problem and we will have a claim on the guarantee for the amount of the lien. So be careful.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
12.12 Mechanic's Liens
Exceptions Manual:
WA Mechanic's Liens
Forms:
None